How to Decide Between Oil and Natural Gas to Heat Your Home

Every year, thousands of homeowners make a decision about which fuel will be their primary heating source for the winter: use oil or natural gas?. The pressure of winter's arrival often leads to a quick decision, but determining which fuel makes the most economic sense depends on a complex set of circumstances that most homeowners have difficulty sorting out. With this simple questionnaire, Popular Mechanics offers a guide to help determine the best way for you to keep warm this winter.

Having been a home improvement editor here for more than 20 years, I can make one prediction with uncanny accuracy: As cooler weather settles in, heating questions will arrive. It may seem obvious. Yet, there's a specific skew for our readers in the Northeast and mid-Atlantic regions. They ask us which heat source is less expensive over the long haul--oil or natural gas. Based on past experience, these are oil-heat customers, and in the heating battleground that encompasses this region, they're bombarded with claims about the benefits of both fuels. This year, the cost of natural gas for residential users is low--about where it was three years ago. When you adjust for inflation, its price has actually dropped. So I'm predicting an upswing in interest in this topic (an increase that will likely subside when the price of gas begins to rise). As gas remains competitive, deciding whether to use it becomes more complex.

See the checklist below to sort your way through. The more answers you check as "Yes," the more likely that the switch from oil to gas may make sense. If you check "Yes" on only on 1 to 3 questions, your current setup works fine. Check more than four, however, and it's worth investigating your options. Seven or more means it may be time to switch to gas.

Notice that I say, "may." I'm not advocating one fuel over the other. The fact is, either can be burned cleanly and efficiently. Both have advantages and disadvantages, which can vary--consult your local fuel-oil and gas providers and mechanical contractors (the businesses that install heating and cooling equipment).

Finally, there's the propane option, and many customers in the Northeast and mid-Atlantic would do well to consider it. If you live in a competitive propane market, the more of the answers that you check as Yes, the more likely that propane could be a viable option as well.

As a side note, consider the Energy Information Administration's unbiased comparison of heating-fuel costs. To get a sense of how this works in your market, plug local price figures into the cost calculator offered by Penn State's engineering department.

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Here's the PM guide to heating-fuel options. Check all that apply.

1. Your oil-heat boiler or furnace is shot and needs to be replaced.

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Yes

No2. Your chimney is old and needs to be rebuilt or relined. Note: New oil or gas boilers and furnaces can be vented directly through the side of the house, bypassing the chimney entirely.

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Yes

No3. You have a natural gas line available and the utility company's cost to run a lateral line from the street to your house is low.

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Yes

No4. The company that will run the gas lateral to your house can place the gas meter conveniently--for example, so that the existing gas line inside the house can access the meter without significant mechanical disruption or remodeling. Note: You need a heating/cooling contractor's input to answer this question.

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Yes

No5. It appears that the gas lateral will create minimal disruption to your property and landscape.

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Yes

No6. Over the past ten years, you've tried several fuel oil providers in your area, at several different price and service plans. You're dissatisfied--either the quality of service has been poor from a mechanical standpoint, or the company just seems unfriendly.

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Yes

No7. You want the fuel oil tank out of the basement. It's either old, rusty and smelly, or you just want it out to free up space down there. Note: Getting an old fuel oil tank out of a basement, especially a crowded one, is a big job. Take some careful measurements of the tank and all stairs or exterior doors before proceeding. PM contributor Pat Porzio, a mechanical contractor, reminds us that some municipalities may require you to pull a special building permit just for the removal of the oil tank, regardless of whether it's above or below ground, indoors or out.

No8. The fuel tank is free-standing and located outdoors. Although it's mechanically sound, you find its appearance unattractive and would like to be rid of it Note: See above, regarding tank-removal permits.

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Yes

No9. The oil-fired boiler or furnace is located in a utility closet somewhere in close proximity to the living space (not the basement or in a crawlspace) and it's too loud. You're hoping to reduce noise in the living space with gas-fired equipment. Note: 10. Oil-fired equipment tends to be noisier than gas-fired, though there are exceptions to this broad rule of thumb. If you're replacing a furnace or boiler, speak to your oil-heat provider or mechanical contractor about noise reduction. If they know that this is an issue, they can better identify quieter equipment and noise-reduction measures (such as relocating equipment to a place where its sound will be less bothersome).

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Yes

No10. You have an electric water heater that needs to be replaced along with the heating equipment. You're hoping to switch to a gas-fired water heater for better hot-water performance. Note: You can also get an oil-fired water heater. Oil-fired water heaters are generally more expensive than comparable gas-fired models, and they need to be tuned yearly, like an oil-fired boiler or furnace. On the other hand, they're extremely potent hot-water producers--residential versions of these appliances are nearly as powerful as their commercial counterparts. If plentiful hot water is an issue, they're hard to beat. Also, an oil-fired boiler can be equipped to produce sufficient hot water, as can a gas boiler. Again, investigate your options by talking to both your oil supplier and a heating/cooling contractor in order to make an informed decision.

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Yes

No If you check "Yes" on only on 1 to 3 questions, your current setup works fine. Check more than four, however, and it's worth investigating your options. Seven or more means it may be time to switch to gas.